1. Arrows up or down: An increase in the wage __________ the opportunity cost of leisure time, which tends to __________ leisure time and __________ labor time.
2. Arrows up or down: An increase in the wage __________ real income, and if leisure is a normal good this tends to __________ leisure time and __________ labor time.
3. We __________ (can/cannot) predict a worker s response to an increase in the wage because the __________ effect and the __________ effect work in __________ (the same/opposite) direction(s).
4. Your objective is to earn exactly $120 per week. If your wage decreases from $6 to $4 per hour, you respond by working __________ hours instead of __________ hours. In other words, your labor-supply curve is __________ sloped.
5. If every worker in a particular occupation works exactly 40 hours per week, regardless of the wage, the individual supply curve is vertical. __________ (True/False)
6. For cabbies in New York City, the elasticity of supply of labor is __________ (positive/negative/zero).